UPDATE: Student loan forgiveness program is about to face its first major test
By Jillian Berman
In October, the first cohort of borrowers will be eligible for forgiveness under the Public Service Loan Forgiveness program
After years of struggling to pay down her student debt amid confusion over government programs designed to help, Lisa Dimone has resigned herself to hoping an app will be what finally eliminates her debt load.
"It's disturbing that I rely more on a trivia game to help me with my loans than the U.S. government," Dimone said. She's been playing the game, which offers a prize of student loan help, twice a day.
Disturbing, maybe, but not altogether surprising given her experience. Dimone, 35, has worked at a public university for the past 10 years and been making payments on her student loans for almost as long. She'd hoped to soon be rid of her debt thanks to the Public Service Loan Forgiveness program (PSLF), which allows borrowers who work for the government or nonprofits to have certain federal loans forgiven after 10 years of qualified payments.
But due to confusion about the program and misinformation from the companies that manage her student debt, she recently discovered she's only made one year's worth of qualifying payments.
"It sucks," she said. "I should be almost done with paying these loans." Instead, Dimone said her nearly $100,000 in debt has kept her living in a one-bedroom apartment within her parents' house, despite having a three-year-old and a career. And Dimone is skeptical that PSLF will still be around when she's eligible to claim forgiveness in nine years. "I am hopeful that this is going to work out," she said.
Why is October an important month for loan forgiveness?